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Rural households access increasing income from crop sales as harvest nears completion

  • Key Message Update
  • Malawi
  • May 2021
Rural households access increasing income from crop sales as harvest nears completion

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  • Key Messages
  • Key Messages
    • Harvesting of most key crops is almost complete in southern and central Malawi and will be complete by the end of June in northern Malawi. Most rural households are now consuming own-produced food, with Minimal (IPC Phase 1) food security outcomes expected to persist throughout the projection period. Some households that faced food and income gaps in the previous season — especially in southern Malawi — are likely transitioning from Stressed (IPC Phase 2) to Minimal (IPC Phase 1) outcomes in late May as they access increasing income from crop sales. The peak period for crop sales occurs in June.

    • In urban areas, income-earning continues to improve for many low-income households alongside gradual easing of COVID-19 restrictions. Stressed (IPC Phase 2) outcomes are now expected at the area-level, with improvement to Minimal (IPC Phase 1) likely by July. Improvement in COVID-19 metrics has continued in May, with the seven-day moving average of new cases reported daily remaining under fourteen as of May 26. Also as of May 26, the weekly average test positivity rate was around 1.8 percent and the overall recovery rate was 95 percent according to the Malawi Ministry of Health. As of May 26, 347,638 people (about 2 percent of the population) had been vaccinated. Despite these improvements, a third wave of COVID-19 and renewed restrictions remain possible.

    • Malawi is expected to realize above-average production of most food crops for a second consecutive season, with production of the maize staple likely to be over 25 percent above the five-year average according to the Ministry of Agriculture and Food Security. However, production of tobacco and cotton — key cash crops for households and for the country’s overall foreign exchange earnings — is expected to be below average. In May, the country’s foreign reserves were equivalent to 1.8 months’ worth of import cover according to the Reserve Bank of Malawi, notably lower than the required 3 months’ target minimum. However, some seasonal fluctuation is typical, and tobacco sales and foreign exchange inflows from development partners are expected to boost foreign reserves in the coming months. Foreign exchange availability can influence non-food inflation via depreciation of the currency. In April 2021, the year-on-year non-food inflation rate was 7 percent, 2 percentage points higher than the same time last year.

    • Food prices have continued to decrease, as is typical during the harvest period. From March to April 2021, year-on-year inflation decreased by 0.2 percentage points to reach 9.2 percent in April, driven by declining food prices. In April 2021, maize prices across monitored markets were 5 to 30 percent lower than prices in the previous month, 12 to 33 percent lower than prices at the same time last year, and 6 to 14 percent lower than the five-year average. Rice prices in April were 6 to 20 percent lower than in the previous month, 6 to 26 percent lower than at the same time last year, and 5 to 26 percent lower than the five-year average. Prices of beans also declined in April and were near prices at the same time last year but remained above the five-year average by 16 to 46 percent. Above-average bean prices are likely due to slightly below-average production as farmers increased maize cultivation given a combination of significant expansion of beneficiaries for subsidized maize inputs (by over 300 percent) and some reported low availability of bean seeds.

    This Key Message Update provides a high-level analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography. Learn more here.

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